DoorDash has raised fees for diners in nearly a dozen cities and counties in an effort to offset limits on what the company charges restaurants, frustrating consumers and angering officials.
The additional fees, which range from $1 to $2 per order, are now being added to customers’ tabs in at least 11 municipalities: Chicago; Denver; Philadelphia; Cleveland; Seattle; St. Louis; Oakland, Calif.; Clark County, Nev.; Westchester County, N.Y.; Fresno, Calif.; and Emeryville, Calif.
All of those places last year imposed limits on the fees DoorDash and other third-party delivery companies charge to restaurants, typically capping them at 15% of the order total. The measures are intended to help restaurants struggling during the pandemic, as third-party delivery fees can account for 30% or more of an order.
Delivery companies have warned that the caps would force them to pass costs to the consumer. DoorDash, the largest delivery provider in the U.S., is doing just that.
“Operating our platform, paying and insuring Dashers, and ensuring high-quality service can be expensive, which is why in many markets where local governments have passed pricing regulations, we have begun charging customers a small additional fee,” a DoorDash spokesperson said.
The new fees have appeared over the past few months as a separate item on diners’ order total, and are labeled with the city name, such as “Philadelphia fee.” This has led some guests to wrongly assume the charge is coming from the city instead of DoorDash. Others are frustrated they have to pay yet another fee for an already expensive service.
Responses to a viral tweet about DoorDash’s $1.50 “Chicago fee” earlier this month illustrate some of those sentiments.
One thing about Chicago, they gon tax your ass lmao https://t.co/rnJoh563oZ— Taylor Rooks Stan Account (@FatMackington) January 2, 2021
We gotta fee too 😭😭 they pick & choose when to have it pic.twitter.com/4RDlPZLjMO— Mœÿåh (@justsimplytee) January 2, 2021
Officials who worked to create delivery fee caps in their cities also pushed back against the new fees.
After DoorDash added a $1 “Cleveland fee,” City Council President Kevin Kelley tweeted on Dec. 31 that the council would explore legislative action, saying “DoorDash’s arrogance, chutzpah and greed is astounding.”
And in a Dec. 19 letter published in the Denver Post, City Councilwoman Kendra Black and Katie Lazor, executive director of restaurant advocacy group Eat Denver, questioned why a company of DoorDash’s size would need to level such charges against consumers.
“DoorDash closed its IPO today at a value of $39 billion. It donated $500,000 to Colorado’s Outdoor Dining Grant Program, yet it is nickel-and-diming consumers with a $2 fee,” they wrote.
DoorDash contends that the fees are necessary to operate in the expensive delivery marketplace. The intention is that they will expire when the caps do.
“We realize this isn’t ideal, but with these regulations in place, these fees help us to continue providing convenient delivery for customers, meaningful earning opportunities for Dashers, and valuable services that help drive orders for merchants,” the spokesperson said.